Decision No. 176/2006/QD-TTg dated August 01, 2006 of the Prime Minister approving the planning on exploration, exploitation, processing and use of lead and zinc ores in the 2006-2015 period, with orientations up to 2020

DECISION

APPROVING THE PLANNING ON EXPLORATION, EXPLOITATION, PROCESSING AND USE OF LEAD AND ZINC ORES IN THE 2006-2015 PERIOD, WITH ORIENTATIONS UP TO 2020

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the March 20, 1996 Law on Minerals and the June 14, 2005 Law Amending and Supplement a Number of Articles of the Law on Minerals;

At the proposal of the Industry Ministry in Documents No. 4683/TTr-BCN of August 31, 2005 and No. 1712/BCN-KH of March 30, 2006, and the opinions of concerned ministries and agencies,

DECIDES:

Article 1.- To approve the planning on exploration, exploitation, processing and use of lead and zinc ores in the 2006-1015, with orientations up to 2020, which has the following principal contents:

1. Development viewpoints, orientations and objectives

a/ Development viewpoints:

- To develop the industry of lead and zinc ore exploitation and processing and lead and zinc working in a sustainable manner and on the basis of rational, efficient and economical exploitation and use of lead and zinc resources of the country.

- To develop the industry of lead and zinc ore exploitation and processing and lead and zinc working in line with the master plan on development of Vietnam's industry and the socio-economic development planning, ensuring the harmony between national interests and interests of localities where exist lead and zinc ores.

- To develop the industry of lead and zinc ore exploitation and processing and lead and zinc working in the spirit of self-reliance and proactive international integration.

- To rationally and harmoniously develop activities of exploration, exploitation and processing of lead and zinc ores and lead and zinc working. Exploration work must be conducted one step ahead to find strategic reserve lead and zinc ores for exploitation and processing. Processing establishments must be located in areas where exist mineral resources of sufficient volume and reliable quality, and use all sources and kinds of domestic ores in an integrated and exhaustive manner.

- To develop the industry of lead and zinc ore exploitation and processing and lead and zinc working in compliance with requirements on consolidation of security and defense, protection of natural heritages, historical relics and valuable cultural works, and protection of ecological environment in geographical areas where exist lead and zinc resources.

b/ Development orientations:

- To build the industry of lead and zinc ore exploitation and processing and lead and zinc working into one developing in a stable and sustainable manner. To consider socio-economic benefits a fundamental objective of development and create jobs in underdeveloped regions and geographical areas.

- To bring into the fullest play domestic resources in terms of capital, science, technology and material foundations, and efficiently use external resources.

- To prioritize exploration in ore sites where there is potential for exploitation on an industrial scale and in compliance with the set mining schedules.

- To develop the industry of exploitation and processing of lead and zinc ores and the lead and zinc working in the direction of satisfying immediate demands while taking the long-term strategy into account: Combining medium-scale with small-scale exploitation and mechanized with semi-mechanized operations, step by step modernizing ore exploitation and processing technologies, importing advanced lead and zinc working technologies in order to maximize the output coefficient of lead, zinc, accompanying metals and by-products.

- To form the domestic market for lead and zinc ores and metals conducive to fair competition and closely linked with the world market for lead and zinc ores and metals.

c/ Objectives:

- To intensify exploration work to ensure sufficient ore reserves for sustainable development of exploitation and processing work. By 2010, to affirm sufficient reserves of lead and zinc ores in 5-6 mines for their designing and building, and 3-5 more mines in the 2011-2020 period.

- Ore exploitation and processing must satisfy to the utmost and in time the lead and zinc working plants' demand for quality mineral materials.

- By 2010, to partially satisfy the economy's demand for lead and zinc metals. In the 2011-2020 period, to quickly raise the output to fully satisfy the domestic demand.

- To raise the competitiveness of pure sulfide ore, zinc oxide powder and lead and zinc metals in the world market.

2. Contents of the planning

a/ Demand for lead and zinc metals

Demand for lead and zinc metals in the 2005-2020 period shall be as follows:

b/ Planning on exploration of lead and zinc ores

- In the period from now to 2010:

There will be 12 exploration schemes, including:

+ One scheme on exploration in Thanh Coc (Tuyen Quang).

+ Four schemes on exploration in mines currently under exploitation where exist unexplored ore sources, including: Lung Vang, Na Bop and Pu Xap mines (Bac Kan province), Ta Pan mine and Ao Xanh mine/ore site (Ha Giang province).

+ Two schemes on exploration in southern Cho Dien and Ba Bo area in preparation for exploitation and supply of ores to ore processing and metallurgical establishments in Cho Dien-Cho Don (Bac Kan province).

+ One scheme on exploration of Cuc Duong ore site for supply of ores to the ore-sorting factory of Lang Hich mine (Thai Nguyen province).

+ Three schemes on exploration of ore sites which have potentials to become mines in Trang Da and Thuong Am ore areas (Tuyen Quang province), and either of two areas currently under investigation and assessment in Sy Binh-Deo Giang and Ba Xu (Bac Kan province).

+ One scheme on exploration of ore sites which have potential to become mines in Na Hang ore area (Tuyen Quang province) for pilot bidding of the mining right after exploration results are available.

- In the 2011-2015 period:

To organize the execution of the scheme on exploration of Ban Bo-Pac Nam ore area (Cao Bang province) and four exploration schemes determined on the basis of results of investigation and assessment conducted in the 2005-2010 period, or some exploration schemes not yet completed in the previous period with a view to preparing reserves for exploitation in subsequent periods.

- In the 2016-2020 period:

To execute five exploration schemes determined on the basis of results of investigation and assessment conducted in the 2006-2015 period, with a view to preparing reserve deposits for exploitation in subsequent periods.

Investment capital for exploration activities shall be around VND 88 billion, of which around VND 64 billion shall be invested in the 2006-2015 period. The list of specific exploration schemes is specified in Appendix I to this Decision.

c/ Planning on lead and zinc ore exploitation and processing

- Planning on exploitation and sorting of sulfide ores:

From now till 2020, to invest in renovating the existing ore-sorting factory of Lang Hich mine; to invest in 8 new mines and ore-sorting factories. The projected total output of exploited and sorted ores shall be around 385,000 tons of crude ores per year.

Investment capital for sulfide ore exploitation and sorting projects in the 2006-2020 shall be around VND 292 billion.

- Planning on exploitation and sorting of oxide ores:

+ From now till 2020, to invest in exploitation in three new mines in Tuyen Quang province with a total output of around 100,000 tons of crude ores per year.

+ By 2015, to invest in building one new plant for zinc oxide powder working with modern rotary kiln with an output of 7,000 tons of 60% zinc powder per year.

Investment capital for projects on oxide ore exploitation and zinc oxide powder working shall be around VND 60 billion.

Investment projects on exploitation and processing of sulfide ores and oxide ores are specified in Appendix II to this Decision.

d/ Planning on purification of lead and zinc from ores

- Zinc purification:

In the 2006-2015 period, to invest in building one modern zinc working plant with an output of 15,000- 20,000 tons of zinc per year in Long Binh An industrial park (Tuyen Quang province).

- Lead purification:

In the 2006-2015, apart from the project on lead purification in Thai Nguyen province for which construction preparations are under way, to invest in a lead working plant applying hydrometallurgical technology with an output of 10,000 tons of lead per year in Nam Bang Lung industrial complex (Bac Kan province) and a plant for lead purification and silver separation with an output of 5,000-10,000 tons per year in Ha Giang province (in Binh Vang or Tong Ba industrial complex).

Projected output of lead and zinc metals in the 2006-2020 shall be as follows:

Investment capital for lead and zinc purification projects shall be around VND 460 billion. The list of investment projects on lead and zinc purification is specified in Appendix III.

e/ Areas where lead and zinc ore-related activities are banned:

Headwater protective forest areas of Ba Be lake (Bac Kan province), Nui Coc lake (Thai Nguyen province) and Na Hang hydropower reservoir (Tuyen Quang province).

f/ Area of natural resource reserve and area where exploration and exploitation rights will be put out to tender:

- Bao Lam-Pac Nam ore area is an area of national lead and zinc ore reserve.

- Na Hang ore area (Tuyen Quang province) is an area where exploration and exploitation rights will be put out to tender.

3. Major solutions and policies

a/ Group of general solutions and policies

- To formulate national policies on mineral resources, including lead and zinc ores, to ensure the sustainable development of the mining and metallurgical industry, which shall have such principal contents as protection, exploitation and rational use of domestic natural resources; intensification of processing of ores into metals; ban on export of crude ores and restriction of export of pure ores; orientations for use of imported mineral materials and crude products; and investment in the exploitation of lead and zinc resources in the regional countries.

- To comprehensively renew the management of mineral resources; to formulate and uniformly apply the system of management of mineral resources throughout the country.

b/ Group of specific solutions and policies

- Group of solutions and policies on lead and zinc resources:

+ To concentrate on evaluating and grading prospects of lead and zinc ore sites; publicly announce lead and zinc sites with good prospects and call for investment in exploration and exploitation thereof.

+ To enhance the protection of lead and zinc ores, including unexplored and unexploited ones.

+ In the course of operation, mining establishments shall have to make adequate investment in pre-mining exploration and exploration in adjacent and neighboring areas in order to increase ore reserves and prolong the life of mines.

- Group of solutions to market formation and development:

+ To form a domestic market for lead and zinc ores and products processed therefrom, and step by step integrate it into the world market.

+ To develop and popularize pricing methods for lead and zinc ores and pure ores and zinc oxide powder appropriate to the market mechanism, and encourage mining and working establishments to exploit, process and exhaustively use domestic ores, including also poor ores, with a view to thrifty using natural resources.

- Group of technological solutions:

+ To research, develop and manufacture mechanical machines and equipment for use in projects for pit mining of metal ores.

+ To organize research into and development of technological processes for efficiently processing (enriching) lead oxide, lead and zinc barite ores, and advanced technologies for lead and zinc purification, and receive and efficiently use transferred technologies.

+ To expand international cooperation, especially in the transfer of technologies for processing lead and zinc ores and working lead and zinc.

- Some other solutions and policies:

+ To reorganize the review and submission of reports on mineral activities (survey, exploration, exploitation, processing, trading and export of minerals); to take strong measures to handle organizations and individuals that fail to fully comply with current regulations on the periodical reporting obligation.

+ To reform administrative procedures for granting mineral activity permits to become more public and transparent.

+ To amend regulations on grading reserves and sizes of lead and zinc ore mines; to elaborate and promulgate the process of exploration of lead and zinc ores (especially in ore sites with a total reserve of C2 grade and forecast natural resources of P1 grade of under 10,000 tons of lead and zinc).

+ To elaborate and promulgate the process of exploitation of lead and zinc ores by pit mining method.

Article 2.- Organization of implementation

1. The Industry Ministry shall:

- Assume the prime responsibility for organizing the implementation of this planning, and coordinate with the Natural Resources and Environment Ministry, the Planning and Investment Ministry and provincial People's Committees in directing the implementation of this planning according to their assigned functions and tasks.

- Elaborate and promulgate the procedural process of pit mining of metal ores.

- Direct the Vietnam Coal and Mineral Industry Group in researching and elaborating technological processes of processing (enriching) lead oxide ore, lead and zinc barite ore (R&D subjects); expand international cooperation on training, scientific research and transfer of technologies for sorting lead and zinc ores and refining lead and zinc.

2. The Natural Resources and Environment Ministry shall:

- Assume the prime responsibility for, and coordinate with concerned agencies in, formulating national mineral resource policies.

- Enhance the specialized mineral inspection.

- Renew the management of mineral resources in general, direct the Department of Geology and Minerals of Vietnam in building and developing the system of management of lead and zinc minerals in the 2006-2010 period. Study and elaborate the process of optimal exploration of ore sites and ore bodies with C2-grade reserves and P1-grade natural resources of under 10,000 tons of lead and zinc metals. To review and standardize functions and tasks of geological federations and units.

- Reform administrative procedures for granting mineral activity permits to be more equal, open and convenient.

- Conduct on a trial basis the bidding of the right to exploit lead and zinc ore mines and sites in Na Hang ore area, Tuyen Quang province after the exploration of this ore area is completed.

3. The Finance Ministry shall:

Assume the prime responsibility for, and coordinate with the Natural Resources and Environment Ministry in, formulating and promulgating policies on assurance of interests of localities engaged in protecting unexploited mineral resources; promulgating the regulations on setting up the insurance fund for risks of mineral activities, and a circular guiding the elaboration of selling prices inclusive of mineral resource tax.

4. The Planning and Investment Ministry shall:

Assume the prime responsibility for, and coordinate with the Industry Ministry and the Natural Resources and Environment Ministry in, elaborating regulations on bidding of the rights to explore and exploit mines.

5. Provincial People's Committees shall:

- Work out plannings on minerals in their localities in line with the national mineral planning; organize and inspect the implementation of the planning on lead and zinc ore resources in their localities.

- Enhance the protection of lead and zinc ore resources; inspect and scrutinize mining establishments; reorganize mineral exploitation, processing and trading activities in their localities.

Article 3.- This Decision shall take effect 15 days after its publication in "CONG BAO."

Article 4.- Ministers, heads of ministerial-level agencies, heads of government-attached agencies and presidents of People's Committees of provinces where exist lead and zinc ore resources shall have to implement this Decision.